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How Do Electronic Communication Networks (ECNs) Prevent Front-Running in Traditional Options?

ECNs use a strict, automated matching process, typically adhering to the price-time priority rule, to ensure fair and objective order execution. They also provide transparency by displaying the best available prices.

The automation and adherence to a strict algorithm prevent human intervention and the manual insertion of an order ahead of another, which is the mechanism for active front-running by a broker.

What Is the “Best Execution” Obligation and How Does It Relate to Preventing Front-Running?
How Do Dark Pools Ensure Best Execution without a Public Display of Quotes?
How Does ‘Time Priority’ in Order Matching Affect the Likelihood of Positive Slippage?
What Is a ‘Central Limit Order Book’ (CLOB) and Its Role in Options Trading?